Crash Course

The art market’s crash — for that is what it is — threatens to remake the art world. In the past few weeks, auctioneers, dealers, artists and collectors have changed strategies and policies, and it’s likely that future changes will be even more sweeping. [ . . . ]

It’s all been a reality check for art collectors. Noted one West Coast art dealer: “Their houses are worth less, their stocks are worth less, but they thought their Rudolph Stingel was still priced the same? No.”

In the wake of the auctions, says Tobias Meyer, a vice chairman of Sotheby’s: “The price disparity between good and great has widened to humongous.” The problem for the trillion-dollar global art industry is that most of the art it has for sale is, by definition, just average. [ . . . ]

(More lessons from the “crash” after the jump.)

In that light, last week’s contemporary art sales were “a disaster, but it’s a good one,” says dealer David Nahmad, one of the world’s most active art buyers. Dealers, by and large, were the ones ponying up for the art that did sell at auction in recent weeks, with Larry Gagosian, Jack Tilton and Robert Mnuchin raising paddles.

The downturn was foreseeable, and some dealers started strategizing early, says Robert Goff, principal of Chelsea’s Goff & Rosenthal gallery. Last April, his gallery halted price increases, trimmed its stable of artists and cut down on art fairs. Meanwhile, “we’re still selling,” he says, though not at the breakneck pace of last year. In New York, only a couple of galleries have closed their doors so far, but several are opening only “by appointment” and not staging new shows. [ . . . ]

Dealers “are offering very fair prices,” says Miami real-estate developer and art collector Craig Robins. Indeed, he argues that the volume of art sales going on in the weak economy points to the “strength — not the weakness — of the art market.” Right now, says auctioneer Christopher Burge, Christie’s chairman emeritus, collectors are “finding excuses not to buy.” But he’s seen several downturns in 40 years at the rostrum, and they don’t last. Ultimately, art behaves much like luxury real estate, he says, with the best material holding and increasing in value. Moreover, bad economies have traditionally spurred better contemporary art, he says.

That said, art sellers of all stripes are refocusing their marketing on the very top end of the market. Earlier this month, in a soaring penthouse apartment overlooking Carnegie Hall, Palm Beach art-fair organizer David Lester spoke to a crowd that included host Wilbur Ross, coal billionaire; members of the Bancroft family (until recently, owners of this newspaper); and designer Mario Buatta. Urging them to attend his American International Art Fair in February — and its new menu for VIP guests of golf outings, private museum tours and dinner at Donald Trump’s Mar-a-Lago — he revealed the silver lining of the current downturn. “Things are going to come to market that would not normally become available,” he said. “There are opportunities.”